Saving money is something many of us struggle with, but we may not be doing ourselves any favors due to some common money wasters.
We spoke to an expert to see how pulling back a little can help save a lot.
Phil Bollin is a Certified Financial Planner out of Perrysburg and says you can start by being realistic and avoid buying lottery tickets. Your chance of winning is practically zero, which is where your bank account will be if you continue throwing money away buying them.
One other way to save, drop the brand name stuff and buy generic drugs when at the pharmacist. Whether it’s just Tylenol or ibuprofen, Bollin says they’re pretty much the same.
“There are a lot of generic offerings available out there where people can save 20% – 40% of their purchases and there’s not a noticeable difference in the quality of the goods and services they’re buying.”
Bollin also suggests you try and avoid bank fees such as minimum charges, ATM fees, overdraft fees and maintenance fees. By shopping around for a better bank, you could save hundreds each year. In the meantime, if you really need cash, make a small purchase at a grocery store and get cash back for free.
Savings can also be found at your local library. There’s no sense in dropping $30 for a new book when you can check it out for free.
Libraries also carry countless books, eBooks, movies, and CD’s.
You can also save by avoiding bottled water, staying away from that $5 coffee and canceling memberships or subscriptions you don’t use.
“Most of us want to have a comfortable retirement,” said Bollin, “and making smaller sacrifices as you move along is sometimes an important part of that.”
Bollin points to data from the Employment Benefit Research Institute that shows that 50% of Americans struggle financially in retirement. He says while saving a handful or two of dollars a week may seem trivial, it can often translate into over tens or hundreds of thousands of dollars over a lifetime.
To help, Bollin suggests you drop these other money wasters: Eating lunch out every day, credit card interest, not shopping around for homeowners and auto insurance, buying the wrong type of life insurance, missing out on your employer’s 401(k) match, college degrees that don’t pay for themselves and shopping for used cars, since buying new vehicles since they have a depreciation of 20% in the first twelve months.
You should also consider only buying in bulk for non-perishable food items and cut the cord since getting rid of cable TV will save you hundreds.
If you smoke, consider this: at $5/day, you’re spending $1,825/year. If you invested that at 6%, then over 30 years you’d be setting aside $144,281.19 for those golden years.
